Refugees in Canada – Labour market outcomes varied considerably over the last three decades

Canada welcomed over 830,000 refugees from 1980 to 2009. Although not selected for economic reasons, the success of refugees in the labour market is an essential element of their long-term integration into Canadian society.

A new Statistics Canada study finds that the labour market outcomes of refugees from 13 countries varied considerably over the last three decades. To date, little information has been available on how labour market outcomes vary across different groups of refugees in Canada.

This study addresses this gap by documenting the employment rates and average annual earnings of refugees from the 13 countries with the largest inflows to Canada over the 1980-to-2009 period. The source countries are Afghanistan, China, Colombia, El Salvador, Ethiopia, the former Yugoslavia, Iran, Iraq, Pakistan, Poland, Somalia, Sri Lanka as well as Viet Nam, Cambodia and Laos (the last three countries are combined as one group). The study, which uses the Longitudinal Immigration Database, focuses on refugees aged 20 to 49 at their time of entry and tracks their employment and earnings up to their first 15 years in Canada. For example, outcomes were tracked from 1986 to 2000 for those who landed in 1985, while for those who landed in 2009, outcomes were tracked from 2010 to 2015.

The study shows that employment rates differed significantly across refugee groups. Five years after entry, at least 75% of male refugees from 7 of the 13 countries had paid employment during the year. For other groups, such as refugees from Iran (56%) and Somalia (44%), the comparable percentages were lower. Among female refugees, employment rates five years after arrival were highest among those from the former Yugoslavia (73%) and China (72%) and lowest among those from Somalia, Pakistan, Iraq, and Afghanistan, ranging from 21% to 39%.

Among refugees who had employment, average annual earnings were highest among those from the former Yugoslavia, Poland and Colombia. The earnings of these groups were almost twice those of refugees from Somalia, Ethiopia, Pakistan and China, who had the lowest average annual earnings.

Differences in labour market outcomes were accentuated by the fact that, among refugee groups with low employment rates, average annual earnings tended to be low among those who worked. The opposite was observed among refugee groups with high employment rates. Furthermore, male and female refugees from the same country tended to have similarly low (or high) earnings. To the extent that refugees tend to be married to partners from the same country, this tendency exacerbates low income at the family level.

The study shows that differences among refugee groups in educational attainment, age (a proxy for work experience), knowledge of an official language, economic conditions, and program of entry to Canada accounted for very little of the longer-term differences in earnings among refugee groups. These earnings differences appear to be related to other factors not observed in this study, such as different experiences in their countries of origin, residence in refugee camps prior to arriving in Canada, and quality of foreign educational credentials.

The approach used in this study will be applied for subsequent waves of refugees, including those arriving from Syria.